Kuwait fund to buy key TPG stake

New York, April 2, 2011

Kuwait Investment Authority (KIA), one of the largest sovereign funds in the Gulf, is set to buy a major stake in private equity firm TPG Capital a source familiar with the situation said.

TPG, a leading global private investment firm run by founding partners David Bonderman and James Coulter, has more than $47 billion of capital under management. It has offices around the world, including Singapore, according to its website.

KIA along with a Singaporean sovereign fund, Government of Singapore Investment Corp (GIC) will buy a 4.5 per cent stake in TPG. The deal values TPG at $10 billion, said a separate source familiar with the situation.

TPG is the latest private equity firm to turn either to the Middle East or Asia for capital, and selling a stake will likely raise questions about whether TPG eventually wants to follow a handful of its rivals in going public.

Blackstone Group went public in 2007 after selling a stake to a Chinese sovereign fund, Kohlberg Kravis Roberts & Co listed in 2010, and Apollo Global Management made its debut on the New York Stock Exchange this week.

Carlyle Group may also file papers to go public later this year, a source familiar with the matter previously said.

A source close to TPG previously told Reuters that the firm had no plans to go public.

TPG told its investors about the stake sale in a letter dated March 31. It said that it had 'completed a private sale of a small, passive minority economic stake' in TPG. The letter, obtained by Reuters, did not specify who the buyers were.

It was unclear how much each fund would buy of the 4.5 percent of TPG that is being sold.

TPG declined to comment, while representatives of the Singapore and Kuwait funds were unavailable to comment.-Reuters